The $500 Billion Do-It-Ourselves Stimulus Program

What if we could put $500 billion back into the American economy each year, create better jobs, reduce corruption and improve the democratic process?

By NAPC CEO, Tim Loncarich

What if we the people could regain control over our government and restore government to its rightful place as the servant of the people?

Wouldn’t that be a worthwhile endeavor? Wouldn’t that make us feel good at a time when we are faced with an increasingly challenging future?

The Problem

American government agencies spend well over $2 trillion dollars a year purchasing goods and services from businesses. I have been closely tracking that spending for the past 15 years. Based on my observations and data, at least 25% of that money is wasted, stolen or otherwise not spent in the best interests of the people. That means that at least $500 billion could be saved if government procurement was improved.

One glaring example of money being misspent is the HealthCare.gov website. So far it has cost American taxpayers more than $2 billion. In reality, the actual software coding should have cost no more than $20 million and another $10 million spent each year for servers, hosting, bandwith and file storage.

I am a software designer and manage teams of programmers developing much more sophisticated software than healthcare.gov. I know how much it really costs to develop and operate websites handling large amounts of data. Other experts have made similar observations. Where did the money really go, and why isn’t someone investigating?

Another good example of how our money is stolen is the case of Chicago Public Schools and its former head, Barbara Byrd-Bennett. Barbara steered $23 million in no-bid contracts for services not needed to a former employer in exchange for kickbacks and other benefits. She pled guilty but is unlikely to see any significant jail time. Closer monitoring and public oversight of Chicago Public Schools could have saved vast sums of money.

And then there is the U.S. Dept. of Defense and the nearly $10 TRILLION that it says it can’t account for. Despite the fact that all federal agencies must be audited and account for the tax dollars they receive, the DOD has failed to comply with these requirements since at least 1996.

DOD employees have admitted to just making up numbers and entering them into accounting programs. Repeated Congressional action has had no impact. While much of the money was perhaps spent prudently and can’t be accounted for due to incompetence, the amount of contract fraud and outright theft of tax dollars through the U.S. military is mind-boggling.

Widely reported on was the natural gas station in Afghanistan that should have cost $500k yet cost taxpayers $43 million. The military refuses to disclose what the money was actually spent on.

“It’s an outrageous waste of money that raises suspicions that there is something more there than just stupidity,” said John Sopko, the Special Inspector General for Afghanistan Reconstruction. “There may be fraud. There may be corruption. But I cannot currently find out more about this because of the lack of cooperation.”

Improper procurement practices means that money is taken from the people, concentrated into fewer and fewer hands and is not circulated into the economy. It means higher taxes, massive debt, lower wages, fewer jobs, more crime, lower-quality education and a decayed infrastructure. It also means less democracy and an increasingly powerful and abusive state.

We are already past the point where the U.S. can no longer be considered a democracy and is more accurately labeled an oligarchy at the federal and some state levels.

America’s middle class has been shrinking rapidly, and the poor have been getting poorer. More American children now live in poverty than in Romania. The U.S. is now near the level of Mexico when it comes to child poverty. At the same time, the rich are getting vastly richer and many of them are using their money to further disempower us.

Our own apathy is the root cause of this problem. We were given a great country by our founding fathers, but generations of neglect by citizens have brought us to where we are now. But it doesn’t have to continue to be this way. It doesn’t have to get progressively worse.

The Solution

Every democracy must have complete transparency and oversight of the government purchasing process.

Transparency and effective oversight by the people greatly reduce corruption and incompetence.

Public oversight improves efficiency and reduces waste. This lowers taxes and improves the quality of government services.

Switching on the light of public scrutiny forces the cockroaches to scurry back into the shadows or get squished.

To help turn on the light, we have created America’s first national procurement portal with the bid advertisements of almost every government agency, along with portals for every state.

Previously, if an American wanted to know how their tax dollars were being spent, they would have to pay for numerous expensive and private bid lead services and they couldn’t share the data with anyone else.

The state portals have a page for every agency which we have recent data from. One can simply look up their county and then look to see if we already have the data for their local agencies.

We have given ownership of these portals to the people. And all of this was done at zero cost to taxpayers. Each day, we publish the procurement solicitations of most government agencies in the U.S. and Canada so that the people can easily see what their public servants are spending money on. This is a great start, but much more is needed.

We need to also post the bids and actual contracts.

We need more businesses using the sites and providing goods and services to government agencies at competitive prices.

We need more people and companies posting their own solicitations for goods and services.

We need the public to know about the sites and to start getting involved in policing agencies.

More agencies need to post their own data so that we don’t have to chase it down and enter it. We offer a free and easy-to-use e-procurement solution for any ageny or private organization.

Now is the time for every American to step up and fulfill their obligations as a citizen. Together we can make government better. One place to start is procurement.